If company valuations reflect growth potential, giant food makers should have moderate ones based on their tendency to increase yearly earnings by 5% to 8%. Yet the aforementioned names now sell for a pricey 17 to 23 times current-year earnings forecasts. The group's average is 19 times—more expensive than fast-growing
Google
(GOOG) at 17 times, not to mention the S&P 500 at 14 times. "I've never seen price-earnings multiples rise so high so quickly," says Robert Moskow, a food analyst with Credit Suisse. He calls the group's hold on investors "Bieber-esque," as in teen pop star Justin Bieber. It could also be described as Buffett-esque; the Berkshire Hathaway head's participation in a buyout of
Heinz
(HNZ), announced in February, has made the group look more appetizing.

The income advantage food stocks have long enjoyed over the broad market has narrowed, notes Graves. Dividend yields shrink as share prices rise. The average food stock now yields 2.3%. Among S&P 500 companies that pay dividends, which make up more than four-fifths of the index, the average is the same, 2.3%. There's also the matter of dividend growth potential. The median food company paid out half its earnings over the past year as dividends, versus one-third for all S&P 500 dividend-payers. Dividend payments have been surging, but in coming years, companies that currently pay out less of their earnings as dividends may have the most room for increases.

It's not all bad for food. This year's corn crop looks likely to be much larger than last year's, which should keep ingredient costs in line, and projections for food companies to increase their earnings by 7% this year look achievable, says Credit Suisse's Moskow. But investors seeking safe harbors should scrap the notion that some industries are inherently safe regardless of price. Price is a key predictor of future performance, which makes it a key measure of safety. The food business remains stable, but its extreme popularity has made it, if not unsafe for investment, less safe.

CONSIDER SOME ALTERNATIVES. The five companies below turned up on a screen for stable earnings, modest valuations, healthy dividend yields, recent dividend growth and plenty of room for more payment increases.

Boeing has long attracted negative attention for delays in bringing its new Dreamliner to market, followed by battery malfunctions that grounded the planes. But jumbo jets aren't smartphones; new models sell for decades and mechanical glitches in early runs are common. The Dreamliner's fuel efficiency and passenger comfort continue to bode well for sales, and while the stock has risen of late as investors come around to that view, it's still cheap. That's because the Dreamliner, which is burning free cash now, will begin adding to it next year. Free cash flow will double to around $12 a share by 2015, says Wells Fargo Securities. That's 14% of the current stock price, which makes Boeing's dividend, at 2.2%, look likely to take flight.

Travelers takes a conservative approach to managing its investment portfolio and balance sheet, which helped it avoid steep losses during the Great Recession. It's reputation for stability has also allowed it to charge premium prices for its insurance. One downside for insurers in general is that, as ordinary investors know well, putting cash reserves to work at safe, reasonable interest rates has rarely been more difficult than now. On the other hand, a lack of ability to rely on portfolio winnings to boost earnings has made insurers more finicky about keeping basic insurance underwriting profitable. Margins are on the rise. Travelers goes for 12 times earnings and yields 2.1%.

L-3 Communications isn't immune to the steep, pending budget cuts known as the sequestration. Management says they could trim 65 cents a share from earnings, or around 8%. But the company has been active in pruning its diverse portfolio of defense programs of ones that are most vulnerable to cuts, according to Deutsche Bank analyst Myles Walton. He points out that L-3 has the best free cash yield among its peers, 13%, and that it combines a 2.6% dividend yield with a stock repurchase program that can reduce the share count by 7% a year. For investors, that's like owning the target of a slow-moving takeover.

House prices are rebounding and housing starts are up. Both signs bode well for toolmaker Stanley Black & Decker, but according to Morgan Stanley, an even better predictor of Stanley's sales success is the pace at which construction payrolls are rising. Construction has been one of the strongest contributors to job growth in recent months. Accordingly, Wall Street expects revenue for Stanley to rise 9% this year. Shares go for 15 times earnings and yield 2.5%.

Occidental Petroleum has underperformed this year amid a squabble over leadership, detailed extensively last week ("What Occidental Petroleum is Really Worth," April 8, 2013). The board, led by a former chief executive, said in February it's looking for a replacement for Stephen Chazen, who is only the company's third chief exec in a half-century, but has been on the job less than two years. Analysts found the timing of the announcement odd. Chazen, 66, was expected to step down anyway within a few years. He has cut costs but also presided over an unremarkable run for the stock. Despite the drama, shares look cheap at 11 times earnings and a 3% dividend yield. Oxy's stability is enhanced by its limited use of leverage and its predictable business of scooping up older oil deposits and using advanced drilling technology to exploit them.